Brand Strategy 101. How Can You Make Your Brand Stronger?

Editor's Note: Take a look at our featured best practice, Strategic Branding (25-slide PowerPoint presentation). What is your brand important? Brands is a major driver of consumer behavior. A strong brand leads to higher market share and higher profit margins. It serves as a significant competitive advantage. In this presentation, we understand what "brand" is dig deeper into why it's important. [read more]

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Based on research with almost 200,000 consumers across 40 countries, the ad agency Young & Rubicam developed a Brand Value framework called the Brand Asset Valuator (BAV).  BAV is based on one of the most extensive research programs on branding ever conducted.

Here is the essence of BAV.  Brand Value can be measured by applying understanding and analysis to 4 pillars:

1. Differentiation,
2. Relevance,
3. Esteem, and
4. Knowledge.

As a brand forms and grows, it develops strengths across these 4 pillars, typically in the order listed above.  This multi-stage process is known as the Brand Development Lifecycle (more on this later).

1. Differentiation

The starting point for all brands is differentiation. It defines the brand and distinguishes it from all others. Differentiation is how brands are born.

As a brand matures, differentiation often declines.  However, even after reaching maturity, with good management, a brand can perpetuate its differentiation.  A low level of differentiation is a clear warning that a brand is fading.

2. Relevance

Next, we move to relevance.    If a brand isn’t relevant, or personally appropriate to consumers, it isn’t going to attract and keep them–at least not in any great numbers.

There is a distinct correlation between relevance and market penetration.  In fact, relevance drives franchise size.

Differentiation and Relevance taken together say a lot about the brand’s growth potential–i.e. the Brand Strength, also known as Brand Vitality.  These two pillars point to the brand’s future value, rather than just reflecting its past.

Relevant Differentiation—remaining both relevant and differentiated—is the central challenge of every brand.

3. Esteem

In the progression of building a brand, esteem follows differentiation and relevance. It’s the consumer’s response to a marketer’s brand-building activity.

Esteem is itself driven by two factors: perceptions of quality and popularity, and the proportions of these factors differ by country and culture. A brand needs to manage these consumer perceptions.

4. Knowledge

Lastly, we have knowledge. If a brand has established its relevant differentiation and consumers come to hold it in high esteem, brand knowledge is the outcome and represents the successful culmination of building a brand.

Knowledge means being aware of the brand and understanding what the brand or service stands for.

Knowledge is not a consequence of media weight alone. Spending money against a weak idea will not buy knowledge.  Rather, knowledge has to be achieved.

Esteem and Knowledge determine the current power of a brand–i.e. Brand Stature, which is more of a “report card” on past performance. This a lagging indicator of brand health.

Brand Stature indicates brand status and scope, the consumers’ response to a brand—therefore, it reflects current brand performance and is a strong strategic indicator.

Now that we have defined all 4 pillars, let’s examine the combination of pillar strengths more closely.  Evaluating this reveals a great deal about the brand’s current health and future strategic positioning.

Let’s say we have a brand with the following pillar strengths, as depicted in the diagram below.

Leading with strong differentiation, this brand is successfully entering the market place, is healthy, and has potential to grow. As it continues to build the relationship with the consumer, brand relevance grows, and both esteem and knowledge will follow.

This is a classic example of unrealized potential. Examples would include momentum brands and successful emerging brands.

Now, let’s look at the exact opposite composition.

In this case, the brand’s highest pillar is knowledge, indicating that the brand is well understood by consumers.  However, lower esteem, (even lower) relevance, and (lowest) differentiation indicate that the basis for choice is fading.

This is an example of an eroding brand–one that is past its glory days. Examples would include commodity brands and former brand leaders.

Brand Development Lifecycle

Through examining various combinations of pillar strengths, we can begin formulating a logical sequence that brands progress through as they grow (eventually decline).  These progression, known as the Brand  Development Lifecycle, can be intuitively depicted on a 2×2 constructed by using Brand Strength and Brand Stature as the 2 axes.

New brands are low on all 4 pillars and reside in the bottom left quadrant.  As the brand grows, it first develops differentiation, then relevance.  The brand moves upwards into the top left quadrant.  A brand with industry leadership potential will exhibit strength across all 4 pillars.  In the final stage, declining brands show high knowledge (evidence of past performance) relative to a lower level of esteem, and even lower relevance and differentiation.

Where does your brand stand?

How can you make your brand stronger?

What are your thoughts on this framework?

You can download an editable PowerPoint about the the Brand Asset Valuator (BAV) here on the Flevy documents marketplace.

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